ERCOT: Transmission Utilities in Serviced Area to See More than $3.6 Billion of Projects Before 2018

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Researched by Industrial Info Resources (Sugar Land, Texas)--The Electric Reliability Council of Texas (ERCOT) (Austin, Texas), in accordance with the North American Electric Reliability Corporation (NERC) (Atlanta, Georgia), recently released a report that said that transmission service providers and utilities in the region serviced by ERCOT are expected to complete more than $3.6 billion of transmission or distribution projects, upgrades or improvements between now and 2018 to reduce future electrical system congestion.

The annual report, titled "Electrical System Constraints and Needs," identifies and analyzes existing and potential constraints in the transmission system that could pose reliability concerns or cost increases to the power market.

Currently, Industrial Info is tracking 25 transmission and distribution capital projects in Texas with a total investment value of more than $2 billion.

According to the report, Houston is one of the two largest demand centers in Texas, and an area in which electric generation additions have not kept up with load growth and generation retirements during the previous decade.

The report says that the Houston area will have nearly 2,000 megawatts of generation from units that are at least 50 years old by 2018. These older generating units are at risk of retirement, because they are not as economically efficient as newer units. This scenario increases the need for additional or upgraded transmission lines into the Houston area, or construction of additional generation as to avoid increased costs to area customers.

For more information, see January 23, 2014, article - Industrial Info Resources Introduces Online Power Transmission & Distribution Database.

The report by ERCOT concludes with a long-term system assessment that says that the Houston area will need at least one additional transmission import path in the next 10 years, and that the Dallas / Fort Worth areas will need additional transmission import lines or upgrades to existing 345-kilovolt (kV) circuits in the future.

With future gas-fired retirements in urban areas, this could lead to an accelerated need for transmission import capacity or dynamic reactive resources in the Houston and Dallas / Fort Worth areas.

Higher-voltage transmission solutions, such as 500-kV transmission lines, become more cost-effective in scenarios that require significant increases in renewable generation, high natural gas prices, and/or increasing water costs associated with drought.

ERCOT is an organization charged with the coordination of market transactions, system transmission planning and network reliability, as well as ensuring the reliability and adequacy of the regional electric network.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, three offices in North America and nine international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.